A recent discussion, “Empowering Africa’s Entrepreneurs: Catalyzing Private Investment for Growth,” convened at the Hamburg Sustainability Conference, tackled the critical challenge of unlocking private capital for Africa’s burgeoning startup ecosystem. Moderated by Mr. Lucy Dempy, the session brought together key stakeholders, including Anna Sophie Herken (Managing Director, GIZ), Obiageli Ezekwesili (Founder and President, Human Capital Africa), Fadilah Tchoumba (CEO, African Business Angel Network), and Eric Andrew (Youth Ambassador from HSC), among others. The dialogue underscored the urgent need for innovative solutions and deep partnerships to scale investments, leverage emerging technologies, and dismantle persistent financing barriers, particularly as GIZ launched a new financing mechanism aimed at mobilizing capital for African startups.
The core issue driving this new initiative is a significant “mismatch” in capital allocation, as highlighted by Anna Sophie Herken. Despite a wealth of opportunities, including “super insured tech, fintech, and all these entrepreneurs,” Africa receives a starkly disproportionate share of global venture capital—only 1%. Herken, drawing on her prior experience in venture capital, described past investments in Africa as often “chaotic” due to perceived high risk and a lack of systematized approaches or matchmaking. This new GIZ initiative, particularly building on insights from the recently launched “Scales” platform for institutional investors, seeks to address this critical gap for earlier-stage ventures.
A profound layer of this challenge lies in gender disparity in financing. Obiageli Ezekwesili lamented that even less than 1% of global venture capital reaches women entrepreneurs in Africa. She attributed this to “historical barriers” that have made it difficult for women to enter structured enterprises, leading over 70% of Africa’s informal economy to be comprised of women. These barriers are multifaceted, encompassing social, economic, and political power dynamics, as well as legal impediments and limited access to education. Ezekwesili emphasized that generic financing instruments are insufficient; solutions must be specifically designed to respond to the particular issues women face, integrating capacity building and market access.
The discussion also prompted a critical examination of perceptions of wealth and financial inclusion. Mr. Lucy Dempy cited a “heartbreaking” statistic from an ASSET report, projecting that women on the continent will not reach financial inclusion parity with men until 2093. She powerfully illustrated this point with the example of her West African grandmother, a market woman who, by formal definitions, was considered poor, yet possessed significant wealth in painted cloth, gold, and beads upon her death. This anecdote underscored how traditional definitions of wealth can problematically exclude women entrepreneurs, prompting GIZ’s new initiative to consider such insights by including aspects of digital and financial literacy from “A to Z”. Ezekwesili further affirmed that young people, women, and technology are the “game changers for the continent”.
Crucially, the panel highlighted the indispensable role of African investors themselves. Fadilah Tchoumba asserted that Africans currently operating within Africa are the “only instrument that will set that base” for future capital attraction, by providing the initial “commercial capital” that builds traction and makes ventures viable for larger funders. As CEO of the African Business Angel Network (ABAN), Tchoumba reported deploying $35 million from over 5,000 angel investors across 37 African countries, which has laid the foundation for numerous venture capital operations on the continent. She expressed confidence that with appropriate incentives, African investors could collectively raise substantial capital, emphasizing their proven ability to drive development, particularly with women entrepreneurs.
Bridging the gap between local African investment and global capital markets emerged as a central theme. Martin articulated the need for “connectivity and barriers” to be addressed, allowing the “value creation” happening on the ground to link with larger capital markets in Europe and elsewhere. He introduced “Scales,” a newly launched initiative designed to “institutionalize and industrialize” finance, thereby creating predictability for founders seeking investment and ensuring large-scale capital fits their specific needs. GIZ, in this context, plays a “crucial role” as a technical partner, leveraging its local presence, convening power, and relationships to facilitate this “transmission engine”.
The role of governance and policy in enabling this ecosystem was heavily debated. Anna Sophie Herken emphasized GIZ’s local work, including advising on regulation, citing Tunisia’s “startup act” which reportedly led to an “80% increase in startup funding”. Obiageli Ezekwesili passionately argued for “entrepreneurial governments” that move beyond a “fixed mindset” that sees government as the sole solution and often acts “against private sector”. She stressed the need for collective agency among young entrepreneurs to advocate for practical governmental support, stressing that “effective governance is key” for the private sector to flourish.
From the youth perspective, Eric Andrew highlighted that young people are often treated merely as a “demographic group” for “tick boxes” and indicators rather than “investments”. He advocated strongly for “flexible financing” models, acknowledging that entrepreneurship is not “strict” and often requires adaptation and changes on the ground that rigid, paperwork-heavy frameworks cannot accommodate. He underscored the need to treat “social topics” as investments, recognizing young people as the “future of Africa’s generation”.
The discussion also critically re-evaluated the very definition of risk. Obiageli Ezekwesili challenged the “perceptual penalty that Africa pays”, arguing that “risk was in New York… not in Nigeria” during the global financial and economic crisis, implying that traditional definitions of risk are flawed and hinder bold investment. Fadilah Tchoumba countered this by stating that her organization “don’t even see risk” but rather “how do we make this work” when supporting innovative solutions. She proudly detailed Catalytic Africa, a matching fund initiative where $1.5 million in initial funding successfully incentivized 200 African business angels to commit an additional $2.5 million within 12 months. This model, along with leveraging domestic financial infrastructure in places like Mauritius and Rwanda, demonstrates tangible ways to build a pipeline of investable companies.
Ultimately, the meeting concluded with a strong call for continued collaboration and innovation. Martin noted that blended finance can scale up but requires “larger landing strips” and more systematic approaches. The new GIZ initiative, formally launched during the session as the “innovative capital mobilization for Africa initiative,” aims to address these challenges head-on. As the session wrapped up, panelists individually committed to making this initiative a success: Martin would work on connecting to larger capital markets; Fadilah Tchoumba committed at least 10% of capital; and Obiageli Ezekwesili vowed to “knock the government,” underscoring the collective effort required to empower Africa’s entrepreneurs and drive sustainable growth.